For the majority of SMEs, the financial situation appears to be improving in Q1 2021, as indicated by the results of a survey conducted by Bpifrance and Rexecode. However, the reality is mixed, and a minority of SMEs are still in difficulty, one year after the start of the health crisis.
Improved cash flow and desire to invest
Despite the continuing health crisis, the financial situation of most SMEs seems to be improving.
This is shown by the latest barometer from Bpifrance and Rexecode, the first edition of which dates back to 2018. The survey is based on responses from several hundred SMEs and VSEs, whose managers were questioned on three themes: cash flow, investment and growth.
Since the first barometer was published in 2018, the perception of the cash situation by SME and VSE managers has never been so positive. In Q1 2021, 55% of them expect their cash position to stabilize, compared with just 48% in October 2020. This optimism is due in part to public support schemes for businesses.
The survey also reveals that 55% of SME and VSE managers plan to invest in 2021, the same percentage as a year earlier, before the start of the health crisis. At the end of 2020, only 41% were planning to invest.
Admittedly, 34% of business leaders surveyed still expect their capital expenditure to fall in 2021, but this percentage is well down on October 2020, when 48% anticipated such a drop.
Another piece of good news is that 68% of SMEs with a government-backed loan have made little or no use of the money they received. And if 59% intend to repay the loan within the maximum 6-year period, it's not so much because of cash-flow problems as out of prudence, to save for unforeseen circumstances.
Major difficulties for a minority of SMEs
However, these figures should not obscure the fact that a number of SMEs are in serious difficulty. They may be in the minority, but they are facing major problems. In most cases, these are companies whose business sector has been particularly hard hit by the crisis.
As a result, 8% of SME and VSE managers say they fear they won't be able to repay their state-guaranteed loan, a percentage that continues to rise. Another worrying sign, up 10 points on September 2020: 23% of business leaders surveyed said they had used up almost all their EMP.
For 16% of SME and VSE owners, the level of their company's equity represents a major constraint, and for 14%, this constraint is linked to the level of debt.